National Economic Council Director Kevin Hassett says Jerome Powell should leave the Federal Reserve Board now, arguing the former chair’s extended stay is unprecedented and undercuts central-bank independence.
Hassett made the case on "Sunday Morning Futures," telling host Larry Kudlow that Powell needs to step aside from the board once his chairmanship has ended. The White House adviser framed the exit as the cleanest way to protect the Fed’s independence rather than prolong a visible partisan split inside the institution.
Fox Business reported Hassett’s remarks as part of the long-running tension between President Donald Trump and Powell over benchmark interest-rate policy. Trump has publicly criticized those rate decisions and stepped up pressure in recent months. If Powell left the board, the president would be positioned to fill the seat.
Hassett did not soft-pedal the point. He cast Powell’s continued presence as a break from normal practice and a drag on the way the Fed once operated.
"I think that it's time for him to move on and to respect the independence of the Fed,"
Hassett told Kudlow. He tied the call directly to institutional credibility, not personal score-settling.
Hassett reached for a plain business analogy to explain why the arrangement looks off. In his view, a former chair remaining on the board after the gavel passes is simply not how orderly transitions work.
"It's completely unprecedented that somebody would have their chairmanship end and not resign right away. It's kind of like when there's a corporation that gets a new CEO. The old CEO doesn't sit in the office next to him, right?"
That line put the issue in everyday terms older readers understand: authority moves, and the prior leader clears the space. Hassett said the same standard should apply at the central bank.
He went further on the independence question. The best path, he argued, is for Powell to trust the people already chosen who actually defend the Fed’s traditional distance from day-to-day politics.
"I think the best way for him to preserve the independence of the Fed is to trust the people that we put there who really, really believe in the independence of the Fed,"
Hassett also urged an end to the open factional look that has settled over the institution.
"End this sort of partisan divide that's very visible at the Fed, and let's move on to the way the Fed used to be in the past."
In short, the NEC director presented resignation from the board as the move that restores normal order and reduces the political heat around monetary policy.
The dispute did not begin as a board-seat fight. It started as a disagreement over interest rates and then broadened. Trump has faulted the Fed’s benchmark decisions and, at points, turned the criticism personal. The pressure campaign intensified in recent months even as Powell continued to appear in public as the face of the institution.
Powell held a news conference in Washington, D.C., on June 18, 2025. Fox Business sought comment from him on Hassett’s latest remarks and did not immediately hear back. The absence of a reply left Hassett’s on-air critique standing as the clearest administration signal yet that the holdover itself has become the issue.
Separate from the rate fight, the Justice Department examined cost overruns tied to multibillion-dollar renovation projects at the Federal Reserve’s Washington headquarters. No charges were brought. Attorney General Todd Blanche later confirmed the department would not reopen a criminal investigation into Powell.
That closed loop matters for the political temperature. Critics of Powell had pointed to the renovation spending as another reason for accountability. Once the DOJ lane shut, the live question returned to governance inside the Fed: whether a former chair should remain on the board after the chairmanship ends, and what that posture does to public confidence in the bank’s independence.
Related coverage has also noted Senate action on Kevin Warsh in the Fed chair context, underscoring that personnel decisions at the central bank remain a live White House and Senate priority. Hassett’s appearance fit that larger personnel and credibility fight: get the transition done the way private institutions handle leadership handoffs, and reduce the partisan optics that have clung to the Fed.
Economists Art Laffer and Douglas Holtz-Eakin also appeared in the broader "Kudlow" orbit to discuss Powell’s leadership, inflation trends, and the condition of the U.S. economy. Their segments reinforced the same backdrop Hassett addressed, inflation performance, leadership at the Fed, and whether current arrangements still serve the country.
Listen to the quotes in sequence and the through-line is obvious. Hassett did not argue that the Fed should take orders from the White House. He argued the opposite: that Powell leaving the board would strengthen the very independence both parties claim to value. Stay-behind arrangements, in his telling, feed the partisan divide he wants closed.
That is a governance argument dressed in common-sense clothes. Corporations do not keep the old CEO in the next office. Boards reset. The NEC director says the Fed should do the same once a chairmanship ends, then let the new team operate without the shadow of the prior tenure sitting in the room.
Trump’s public frustration with rate policy supplied the political fuel. Hassett supplied the institutional rationale. Together they leave Powell with a clear message from the administration’s economic shop: the chairmanship chapter is over, the board seat should follow, and the central bank would look more independent, not less, if the handoff were completed cleanly.
Voters who want stable prices, honest markets, and a Fed that looks like a referee instead of a factional prize will recognize the stakes. Leadership transitions work when they are final. Hassett said the quiet part out loud: it is time for Powell to move on.
